I wince whenever I listen to a speech or read about the opportunity to bring many of the 39 million former students back to college for a degree they did not complete. My wince is not because I doubt the veracity of the 39 million number. The National Student Clearinghouse (NSC) issued a report in 2022 that established that number. In fact, four states, California, Texas, New York, and Illinois account for more than one third of the “some college, no credential” (SCNC) group. NSC reports during the academic year 2020/21, 944,200 SCNC students reenrolled and 60,400 earned their first ever college credential. An additional 531,700 SCNC students were still enrolled after reenrolling the previous year.
Let’s examine the most optimistic statistics from the report. Out of 39 million plus, just 944,200 SCNC students reenrolled. That’s 2.4 percent of the SCNC population. If the 531,700 former students who reenrolled from the previous year were from the same size population (944,200), that means only 56 percent of those students who returned were still enrolled one year later.
Why are the numbers of students who are willing to return so low? Is it because none of their original schools are trying to reconnect with them? Perhaps. According to NSC, approximately 62 percent of the 944,200 who reenrolled changed institutions. Why did they change institutions? Probably because they responded to the more than $2.5 billion in advertising that colleges spent in 2019.
Leading the way were the two biggest online universities, Southern New Hampshire ($144M in 2019) and Western Governors’ University ($124M in 2019). I’m sure there were many others not so far behind. Because I am not a paid subscriber, I don’t have access to the most recent reports from Kantar. However, Campus Technology cited Kantar as reporting that higher education advertising reached $870 million for the first quarter of 2021. Annualized, that indicates higher education ad spends were more than $3.5 billion in 2021. Imagine what they are in 2023 as schools compete for fewer students.
Is it effective to have more and more education institutions increase their media spend to reenroll former students from the 39 million SCNC population? You could argue yes given that only 2.4 percent of that group returned in 2021. At the same time, I posit that the large online institutions (SNHU and WGU among others) have sophisticated Search Engine Optimization (SEO) analysis teams that evaluate the ROI of incremental marketing and spend to max out enrollment. They are online and generally open enrollment. They don’t have capacity issues. They would spend more money if they thought it would result in more students. I have a feeling that the largest online institutions are responsible for a large percentage of the existing SCNC returners.
I looked at another way to test my theory that very few of the SCNC group will reenroll in college. I recalled two reports that I wrote about in my blog. The first of these reports was published by New American in 2020. The report was called The Comeback Story. Only 12 percent of the SCNC group that they tagged as “comebackers” were enrolled for two years or more after returning to college. The 12 percent group was tagged as “potential completers.” While that number was higher than the 2.4 percent reported by the NSC, I wrote in my review at the time that the low number of students in the New American study (7,843 adult students who connected with the Graduate Network) could have influenced the difference between their percentage of “comebackers” and the NSCs percentage of actual SCNC returners.
The second report that I recently wrote about was a research study that reviewed the college success data from students who attended 28 community colleges that were members of the Virginia Community College System (VCCS) between the summer of 2009 and the spring of 2014, earned 45 credits or more, and who dropped out and did not reenroll for at least three years after dropping out. There were two findings in the report that I found illustrative as to why students who drop out might not return. First, after leaving community college without a credential, students with substantial academic progress typically experience steadily increasing wages. Second, most students with substantial academic progress who left college without a credential were in a field of study without significant earnings premia associated with completion. The researchers reported that of the 26,000 students in the study who made substantial academic progress before stopping out, fewer than 1,000 (approximately 3 percent) could easily reenroll in fields of study that provided a sizable earnings premium.
There are three points of data that are notable from the three reports mentioned. The NSC report indicates that 2.4 percent of the SCNC population of 39 million are currently returning to college. The New America “comebackers” potential percentage of SCNC completers is 12 percent. The VCCS population who could easily reenroll in college and receive a sizable earnings premium was 3 percent of a smaller group because it only included students who dropped out with 45 credits or more.
Let’s say that I am aggressive with my review of the three reports and estimate that with a lot of persuading 5 percent of the 39,000,000 SCNC group can be convinced to return to college. That’s approximately 1 million more SCNC students than returned in the NSC report. My guess is that any institution asking its board to justify investments in online courses and programs to recruit into the population of former college students with some credits but no credential will report a TAM (total addressable market) of 39 million and not 1 million. You’ll have to work hard to convince me that it’s any more than 5 percent when I believe that 3 percent is more likely the real potential.